Opel may return to profitability in 2011

Article by Christian Andrei, on August 27, 2010

Opel aims that in 2011, it will be profitable once again and it will be able to repair its reputation that was damaged due to the months of uncertainty, according to CEO Nick Reilly.

At the sidelines of the Automotive News Europe Congress last Tuesday, Reilly said that because of major restructuring costs, a profit is not feasible this year.

Parent General Motors Co. had made a last-minute decision last year to keep Opel. In doing so, it turned its back on months of negotiations to sell it. Opel is proceeding with a drastic restructuring plan involving 8,300 job cuts.

Reilly said that Opel has a "shot at getting to breakeven or even a little better" next year. He also said that "2012 should be fine." He said that the market in 2010 is stronger than had been predicted, despite the fact that scrapping incentives have been phased out in several markets.

He described the market today as being "about a million units higher" than the forecast seven or eight months ago.

When asked about the possibility of another downturn occurring very soon, he said that he doesn't expect a "significant double dip in the auto industry" and instead, he expects a "gradual, continual improvement." [via autonews - sub. required]

Topics: opel, profit

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